The Solana-Ethereum (SOL/ETH) spot trading pair on Binance has experienced a remarkable surge of over 15% since October 1, continuing a three-month winning streak. However, analysts suggest that the rally may be reaching unsustainable levels.
According to TradingView, the pair’s 14-day relative strength index (RSI), which measures the speed and change of price movements, has surpassed 70, indicating overbought conditions. This is the highest RSI reading since March, coinciding with a record high of 0.069 reached on Wednesday, driven by a resurgence in Solana’s network activity.
While an RSI above 70 does not necessarily signal an imminent end to the bullish trend, it suggests that the recent upward movement may be excessively strong, raising the possibility of a temporary price correction or breather. Should a pullback occur, support could be found at 0.064, the high established in August.
Some seasoned traders interpret an overbought RSI, particularly on longer-duration charts, as a sign of robust bullish momentum, indicating that the path of least resistance remains upward. As the saying goes, the RSI can remain overbought longer than bearish positions can sustain.
Bitcoin-Gold Ratio Declines
In a related market analysis, the ratio between Bitcoin‘s price per unit and gold’s price per ounce has declined after failing to break through a trendline resistance established from highs in March and June. This rejection, combined with a negative crossover on the Moving Average Convergence Divergence (MACD) indicator, suggests that Bitcoin may continue to underperform in the near term. A similar situation observed in late July resulted in a prolonged decline in this ratio.
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